7/24/2019 Introduction to Business - BUS1135 Lecture 03

1/8

BUS1125

Introduction to Business

Lecture 03

7/24/2019 Introduction to Business - BUS1135 Lecture 03

2/8

Definition

Sole Proprietorship is that type of businesswhich is owned by one person.

7/24/2019 Introduction to Business - BUS1135 Lecture 03

3/8

Advantages of Sole Proprietorship

Freedom in formationThe easiest to establishIndividuals are allowed to decide withoutinterference of any other person.Easier to transfer the ownership of thebusiness

People wholly solely enjoy the ownership ofthe business and profits

7/24/2019 Introduction to Business - BUS1135 Lecture 03

4/8

Advantages of Sole Proprietorship

Individual has unlimited opportunity to expandthe size of the businessIndividual can keep the secrets of the

business intactIndividual has personal interest in thebusiness

Owners can make speedy decisionsEasy to dissolve

7/24/2019 Introduction to Business - BUS1135 Lecture 03

5/8

Disadvantages of Sole Proprietorship

Limited amount of capitalContinuity problemSole Proprietorship has limited life and isdependent on the owner Owner of the business has unlimited liabilitytowards people whom he has to pay

7/24/2019 Introduction to Business - BUS1135 Lecture 03

6/8

Partnership

A relationship of the people to shareinvestments and profitsPartnership act 1932 governs all affairs of the

partnership

7/24/2019 Introduction to Business - BUS1135 Lecture 03

7/8

Advantages of Partnership

More capitalRelatively easier to formSharing of responsibilityLight credit standing

Business can have more loan from varioussources

Secrecy

7/24/2019 Introduction to Business - BUS1135 Lecture 03

8/8

Advantages of Partnership

Public ConfidenceBetter DecisionEasy to dissolve